Financial freedom is all about reaching the stage of life where you have enough money to do all that you need to do. It involves having enough to take care of your needs and wants. It means having enough to take care of your every whim. Financial freedom is an achievable dream. It is a reality that a lot of people are already living in.
The question is, how do I achieve financial freedom?
The answer to the above question has been answered by various individuals. There are those that preach savings is the way to go while others preach investment is key. This is where the confusion stems from. That is the reason we at Amazons Clique has decided to bring to your awareness what savings and investment entails and you can choose which ever fits your bill.
This brings about the question, what is Savings?
Savings is the act of putting money aside for future use. It involves setting aside a percentage of your income. Savings comes in different forms and directions. It could be in a bank, at home, amidst friends and family or in whichever activity that involves putting money aside for future use.
You cannot save what you do not have, you need to have an income before you can think of saving.
To further understand the topic, what is investment? Investment involves using money and/or effort to multiply income. Note the definition of investment does not tie investment solely to money. It means you don’t really always need money to make an investment. Investment is not a get a rich quick scheme. It takes time and effort for your investment to yield. Investments comes with a lot of sacrifices, investments don’t just grow over night and its not even certain they will but after every investment even if you end up failing at the investment you come out stronger.
With investments you can either win or lose.
When you win, you make more money as you have planned. The most devastating and frustrating option is losing your investment. Losing your investment could be as a result of a lot of factors, however the bottom line is you can lose your investment and when you do it makes you stronger and better. Losing your investment is not the end of the world, it is your reaction to the loss that makes the difference and brings the good out the situation. Every great man has made an investment that they lost at a point in their live, some even has more than one before their big break.
One of the major difference between savings and investment is, with savings you really don’t exert any effort apart from putting the money aside in wherever you plan to save it but with investment, it doesn’t stop at putting the money in whatever you plan to invest on, it involves additional effort in order for it to give the expected effect.
Another obvious difference between savings and investments is, Savings has either zero or minimal risk as the case may be but with investment the risk is always very high depending on the expected returns. The higher the returns on the investment, the higher the risk to be expected. That is what makes investment an adventure and all the more alluring for some people.
The major question is, which helps to achieve the goal of financial freedom in the end, is it savings or investment?
Your word of mouth alone will not bring you to the position of financial freedom, it will only make you frustrated to realize that you are getting nowhere at all with your goals. Financial freedom is not all about keeping your money and waiting for it to magically multiply. Financial freedom involves allowing that money to work for you and multiply at your pace. Investment no matter how small has the major goal to bring in more money at an estimated period.
Savings do not bring as much as an investment does when all goes well with the investment.
Savings is only a cushion for bad financial days it is not the ticket to financial freedom. This is because it is just lying there with no meaningful increase in your overall net worth no matter how long it stays where ever you put it. Only your investment does that for you. It is only your investment that gives you the access to begin the journey to your financial freedom.
It is up to you to decide which path you would like to take, either savings, investment or both.
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